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Fund Times

Phillip Gray   |  10 Sep 2009Text size  Decrease  Increase  |  

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In recent news from the funds management industry, an AXA/Bernstein quantitative analyst has departed; Fortis has hired for its Australian equities team; Colonial First State has hired a cash manager; OptiMix has restructured its emerging markets investment manager line-up; and the co-portfolio manager of UBS' Equity Income fund has left.

AXA/Bernstein quantitative analyst departs

Quantitative Analyst Tze-Wai Yiu, whose role included work for AXA Wholesale Australian Equity – Value (10020) and AXA Generations – Bernstein Australian Equity Value (10032), has left the firm to establish his own business. Investment manager Bernstein is seeking a replacement, and in the interim has moved New York-based Quantitative Analyst Lilian Quah to support the process. Quah has worked extensively over the past 12 months in developing and rolling out quantitative risk management tools, and will work in the team headed by Head of Quantitative Value Research Kent Hargis and Global Head of Quantitative Research Andrew Chin. Our fund research analysts have assessed the effects of the departure and elected to make no change to the existing Morningstar Recommendation of 'Recommended'.

Colonial First State hires cash manager

Colonial First State has hired Martin Ross as a Portfolio Manager for the firm's Short Term Investments Team. Ross, whose 12 years' investing experience most recently included a stint at AMP Capital Investors, will manage cash portfolios including swap hedging, derivatives trading, and investing in bank and corporate debt securities. The firm's major cash funds are Colonial First State Wholesale Premium Cash (4018), Colonial First State Wholesale Premium Cash Enhanced (7007), Colonial First State Wholesale Cash (5334), and Colonial First State Premier Cash Management (2016).


Appointment to Fortis Australian equities team

Fortis Investment Partners – the former ABN AMRO funds management business in Australia – has appointed Chris Tynan as a Research Analyst. He'll work primarily on quantitative and industry analysis, maintenance of the firm's equities database and act as back-up dealer to Simon Twiss. Tynan will work with Head of Australian Equities George Clapham, Portfolio Managers Mark Nathan and Neil Boyd-Clark and the rest of team. He worked previously in database analysis at Colonial First State and Capgemini Ernst & Young before joining Fortis in December 2007. Fortis Investments Australian Equity (7899) is one of the select group of large-cap domestic share funds to which we have assigned our highest-possible Morningstar Recommendation of 'Highly Recommended', because of the intuitive and robust investment process, longstanding and impressive team, and low turnover.

OptiMix reshuffles emerging markets manager line-up

ING-owned multi-manager OptiMix has reshuffled its roster of fund managers for OptiMix Global Emerging Markets Share (16733). The firm has appointed Pioneer Investments and Legg Mason subsidiary Batterymarch as replacements for foundation core managers Deutsche and PanAgora, and added two exchange-traded funds providing exposure to China and the Gulf region. The existing 20 percent allocation to French investment house Comgest remains unchanged, while OptiMix has cut the in-house OptiMix India allocation from 10 to 3.50 percent.

Boston-headquartered quantitative firm Batterymarch's emerging markets team, led by David Lazenby, uses a model which ranks stocks for relative attractiveness across countries, sectors, market-cap, and style, focusing also on efficient transaction cost management. Pioneer, which has been investing in the emerging markets since 1994, has an active, bottom-up, research-driven approach to selecting stocks. The firm's emerging markets investing is headed by John Pollen, who took over the portfolio in 2005 and has focused on the region for 20 years.

OptiMix said that the decision to alter the manager line-up was the result of an internal review seeking to identify investment managers able to identify value-adding opportunities from themes such as infrastructure development, consumerism, and the development of financial systems within the framework of country and sector analysis to select stocks with sustainable earnings growth.

The standalone OptiMix funds are closed to new investors, but the strategy continues to be available through ANZ and ING OneAnswer platform options including ANZ OneAnswer OptiMix Global Emerging Markets Share (16621) and ING OneAnswer OptiMix Global Emerging Markets Share (15844).

Table 1: Changes to OptiMix Emerging Markets investment manager line-up

 Manager Name

 Previous Allocation %

 New Allocation %

Deutsche 35


PanAgora 35


Comgest 20 20
OptiMix India 10 3.5




China ETF


Gulf ETF




UBS Equity Income co-portfolio manager departs

Piers Bolger, Executive Director, Head of Research and Investments at UBS Global Asset Management Australia and co-portfolio manager of UBS Australian Equity Income (13204), has left the firm to take up the position of Senior Manager, Research and Product at BT Financial Group. The fund will now be run solely by David Anderson, Bolger's co-portfolio manager since Paul Stanley's departure in November 2008.

UBS designed Equity Income to generate tax-advantaged income from investing in the Australian sharemarket. The fund's run according to a largely quantitative process developed by UBS subsidiary DSI, Anderson's role being to override the stockpicking model to take into account issues such as share buybacks and the use of options. We have updated our research report to account for the departure, and have reiterated our existing Morningstar Recommendation of 'Investment Grade'.


Fund terminations

Finally, a couple of noteworthy recent fund terminations: Colonial First State's unsuccessful attempt to run a high-conviction domestic listed property fund, Colonial First State Wholesale Property Securities Opportunities, and DWS Global Climate Change, launched two years ago just before the onset of the global financial crisis and which never reached more than A$10 million in assets.

Phillip Gray is Morningstar's editorial and communications manager.